Prime Minister Shinzo Abe said Tuesday that the government will carefully examine at meetings of its key economic panel whether the Bank of Japan's drastic monetary easing has begun to improve people's livelihoods.
Abe made the remarks amid growing concern that the central bank's easing could merely drive up consumer prices without wage growth, as the BOJ has pledged to achieve a 2 percent inflation target within two years though the country has long been mired in deflation.
"We'll pay attention to whether (the BOJ's monetary easing measures) have led to income growth and created a virtuous circle that would improve the lives of the people," Abe said during a meeting of the Council on Economic and Fiscal Policy.
The government and the central bank on Tuesday held intensive discussions on monetary policy during a meeting of the key panel, the first attended by Haruhiko Kuroda since he became BOJ governor on March 20.
Under Kuroda's leadership, the central bank introduced a set of new monetary easing steps on April 4, including additional purchases of government bonds and risky financial assets such as exchange-traded funds and real estate investment trusts.
Economic revitalization minister Akira Amari said at a press conference after the meeting that Finance Minister Taro Aso had asked Kuroda to implement monetary policy measures to help prices and wages grow simultaneously.
Aso added that the government and the BOJ have to consider why nominal wages have been declining in Japan, according to Amari.
One of the private sector members of the panel, which includes scholars and company executives, called on Kuroda to act to push up prices and shore up the real economy in a balanced manner to promote fiscal rehabilitation and growth strategies, Amari said.
During the meeting, Abe urged his Cabinet members to map out a plan to develop infrastructure through the utilization of private funds, Amari said.
Given the devastating March 2011 earthquake and tsunami, Keiji Furuya, state minister for disaster prevention, promised to craft an outline of steps by the end of this month to make the nation's infrastructure more resilient to disasters, Amari added.